Uncertainty over definition of European employment pact

The German EU Presidency of the first half of 1999 is keen to achieve agreement on a "European employment pact" similar to that recently agreed in Germany. However, progress in this area has so far been limited and an informal meeting of social affairs minister in Bonn in February produced few concrete results.

The start of the German EU Presidency in January 1999 coincided with the launch of the single European currency, and a central objective of the Presidency has been the creation of a social accompaniment to the euro in the form of a "European employment pact" (DE9811184F). A tripartite national "alliance for jobs" was concluded in Germany in December 1998, soon after the current red-green government came to power (DE9812286N). The Presidency has reportedly set its sights on concluding a pact at the Cologne"European Council" meeting in June. However, developments in this area have so far been limited, and it appears that there has been difficulty in getting the notion of a pact off the ground. A informal meeting of EU labour and social affairs ministers on 4-5 February in Bonn did little to change this situation. The idea of the pact was discussed at length at this meeting, also attended by representatives of the European Parliament, European Commission and European-level social partner organisations, but little concrete merged about the pact's possible workings or content.

Among the EU's issues of primary concern where rapid and effective action is necessary, as identified by the Vienna European Council in December 1998 (EU9812141N), is the promotion of employment, economic growth and stability. The German Presidency believes that there is a need for greater economic policy coordination in order to combat existing unemployment levels and to enhance the effectiveness of Economic and Monetary Union. A central component of this process is seen as being the creation of the European employment pact, within the framework of the employment strategy launched at the Luxembourg Employment Summit in November 1997 (EU9711168F).

The Presidency recognises that progress is being made, as the European unemployment rate has fallen below 10%, and Member States have been active in implementing the EU Employment Guidelines (EU9810130F) through their National Action Plans (EU9805107N). In addition, the social partners have taken a more active stance on this issue. Essentially, the idea of a European employment pact encompasses:

• more employment opportunities in the macroeconomic context of wages, monetary and fiscal policy; and

• the coordination of national employment policy measures, which was given a sound basis in the Amsterdam Treaty (EU9707135F) and the decisions of the Employment Summit.

Another important factor is that the role of the social partners in the employment process has been recognised in the recent report of the "high-level expert group on economic and social implications of industrial change".

The European Trade Union Confederation (ETUC) has called on the Commission and on the Presidents of the Economic and Financial Affairs and Labour and Social Affairs Councils to launch a consultation on this matter - the European Council has recognised that a broad and intensive dialogue between all actors involved, including the social partners, is of prime importance contributing to the overall strategy for employment, growth and stability. A final potential contribution to the debate is that the Commission has been invited to present a communication on "mainstreaming" employment policies at Community level in spring 1999.